HUD secretary says administration seeks to get Jersey Shore open for business

Published: Thursday, Dec. 6, 2012 9:27 a.m. CDT

By Melissa Hayes and Herb Jackson — The Record (Hackensack, N.J.)

(MCT) — WASHINGTON — President Barack Obama’s point man for Superstorm Sandy recovery said Wednesday that the administration is working to get the Jersey Shore open for business next summer and pledged to help the state rebuild better and stronger as they try to make sense of damage assessment figures.

“We want to ensure that homes that were lost are rebuilt, businesses are restored and communities are made whole,” Shaun Donovan, secretary of Housing and Urban Development, told U.S. Sen. Frank Lautenberg, D-N.J., at an appropriations subcommittee hearing. “We want to build back stronger, smarter, safer and more resiliently — a 21st century response.”

Donovan said a summer of lost revenue at the Shore would be “devastating,” but some committee members said the federal government can’t afford to pay for everything.

“There just simply isn’t enough money to go around to fund all the essential functions of the federal government,” said Sen. Dan Coats, R-Ind., the top-ranking Republican on the subcommittee. But even Coats agreed the rebuilding effort should include measures to mitigate damage in future storms.

Gov. Chris Christie will be in Washington Thursday to press members of Congress as well as the Obama administration to help fund New Jersey’s recovery and to help finance projects to protect the state in future storms.

Christie’s visit is the latest push to get money and to get it quickly to homeowners, businesses and all those trying to recover from the storm that he says did nearly $37 billion in damage.

Added to all the number crunching is an effort to separate what private insurance will cover and what existing programs will provide to offset the combined $79 billion damage estimate Christie and New York Gov. Andrew Cuomo have sent Obama. The administration is also trying to separate immediate recovery needs from the long-term projects that could be funded in future budgets.

The Federal Emergency Management Agency has already paid $227.6 million in individual assistance, which would cover claims filed by homeowners in New Jersey. FEMA has issued another $81 million to local governments for debris removal and emergency work to protect public health and safety.

Donovan also told the subcommittee that media reports the administration is prepared to make a $50 billion request to Congress for supplemental funding to help states recover were not true and the administration is still trying to refine its request.

FEMA Administrator Craig Fugate said in an interview the initial request would only cover projects that would be finished in the current fiscal year.

“Our annual appropriation is not always the total figure for a disaster,” he said. “It’s what we tend to expend.”

Lautenberg and U.S. Sen. Bob Menendez, D-N.J., joined Sens. Charles Schumer and Kirsten Gillibrand, both New York Democrats, in a statement saying $50 billion would be insufficient.

“While $50 billion is a significant amount of money, it unfortunately does not meet all of New York and New Jersey’s substantial needs,” they said. “While we know there will be additional supplements, the administration needs to come as close as possible to meeting our states’ needs in the first request.”

Christie’s office released a $36.9 billion storm damage estimate last week, which included $7.4 billion for “mitigation and prevention.” The estimate includes broad descriptions — $5.5 billion for parks and the environment and $8.3 billion for businesses — and offers no information on how the administration came up with that number or specifics on what it covers.

Christie’s office has declined to release details.

Mary Goepfert, a spokeswoman for the New Jersey Office of Emergency Management, said the figure is compiled with input from local officials and the county emergency management offices, which submit breakdowns of how many homes, businesses and public properties were damaged. She said each state department is responsible for assessing damages for areas they oversee.

Because of the severity of the damage, Goepfert said aerial photographs were used to assess losses in places that were inaccessible.

The state Office of Emergency Management monitors projects along with FEMA and is in charge of taking federal funds sent to the state and reimbursing local governments when work is completed.

Christie and Cuomo’s figures include costs that will be covered by insurance, some that will be covered by FEMA’s flood insurance program and others that have already been reimbursed by the agency. That’s what Obama’s administration is trying to wade through as it comes up with a request for supplemental funding from Congress.

“What the governors gave us is not, ‘Congress has to pass $82 billion,’ ” Donovan said at the hearing. “It’s, ‘These are the damages, let’s work with you to figure out what needs to be covered by the federal government.’ ”

The Obama administration has said it’s committed to taking a close look at issues that have an impact on the Jersey Shore and ways to ensure it’s ready for the summer tourism season.

The administration is also considering asking Congress to change limitations on FEMA’s programs to expedite funding as well as resources to help small businesses not only deal with damages, but lost customers and tourism, Fugate said. For example, he said a homeowner without insurance would only be eligible for up to about $30,000.

State Sen. Paul Sarlo, whose district includes Moonachie and Little Ferry where the storm caused severe flooding and destroyed homes, said as residents are filing claims with FEMA, they’re learning they may not get as much as they anticipated and now their frustrations are turning into anger.

“The immediate response always is FEMA will be there for you, but there’s many limitations FEMA has been placed under from Congress,” he said.

Fugate said the federal government is also trying quickly to approve estimates and distribute reimbursements because many New Jersey municipalities run on a calendar year and need to close their books Dec. 31.

FEMA will also be looking to borrow money from Treasury because its flood insurance program doesn’t have big enough reserves to cover the expected exposure from Sandy, Fugate told reporters.

“We’re going to be looking at increased borrowing authority based on the number of claims that are being filed and looking at available cash on hand so we have included in our request what additional borrowing authority we’ll need,” he said.